Minimum Wage Hike Comes To 13 States, Public Favors National Raise

A minimum wage hike is coming to low-wage workers in 13 states when the calendar turns to 2014, but many economists and low wage workers themselves— say that’s not enough. Two Democratic congressmembers have crafted a bill to raise the national minimum to $10.10 per hour from $7.25, and President Barack Obama has thrown his support to the idea.

The American public also backs the plan. In fact, according to a recent ABC News/Washington Post poll, the public wants an even bigger increase. Two-thirds of those polled, 66 percent, said that the minimum wage should be raised. And when asked how much, those people on average favored a hike to $10.25.

Several cities will also raise local minimum wages starting next week, according to a roundup of the coming increases compiled by The Huffington Post. When the new year rolls around, the highest minimum wage in the country will belong to the suburban Seattle community of SeaTac, Washington, where voters in November passed a measure boosting the rate to $15 per hour for workers in the city of about 26,000 around Seattle’s airport.

As far as statewide minimums go, Washington will retain its title as the minimum wage leader, raising the state minimum from $9.19 per hour to $9.32. New York and New Jersey are both currently at the national minimum, but in 2014 they’ll set new minimums of $8.00 and $8.25 respectively.

Oregon will go up from $8.95 to $9.10, while the city of San Francisco beefs up its local minimum from $10.55 to $10.74 and neighboring San Jose cranks it up from $10.00 to $10.15.

But it’s not only the liberal northeast, northwest and northern California that are on the higher-minimum-wage bandwagon. Predominantly conservative states Florida, Arizona, Missouri, Montana and Ohio will also hike their minimums, though all will still come in under $8.00 per hour.

Democratic legislators in Florida are pushing a bill to raise that state’s minimum to $10.10, according to the local Bay News, matching the federal proposal introduced by Senator Tom Harkin of Iowa, and Rep. George Miller of California.

California also passed a statewide minimum wage hike law this year, phasing an increase from $8.00 to $10.00 over the next three years.

The federal minimum wage has not increased at all since 2009, but more significantly, when measured in real terms — compared to inflation – it has actually dropped by about 30 percent since 1968.

In that year, translated into today’s dollars, the federal minimum wage would have been $1.56 per hour, according to an overview of minimum wage policy in Atlantic Monthly.

Opponents of raising the minimum wage subscribe to the argument put forth earlier this year by Republican House Speaker John Boehner, who told The Huffington Post, “When you raise the price of employment, guess what happens? You get less of it. Why would we want to make it harder for small employers to hire people?”

But does raising the minimum wage really lead to large-scale job loss? In a study at the University of Chicago’s prestigious Booth School of Business, 38 prominent economists were asked that question, specifically with regard to a $9.00 per our minimum wage.

Their responses were split pretty much down the middle, with 34 percent saying yes, a higher minimum wage would make it harder for workers are the lower end of the skill scale to find jobs — and 32 percent saying no, it wouldn’t. And then there wee the 24 percent who weren’t sure and the three percent (that is, one economist) with no opinion.

Last week, the Economic Policy Institute think tank released a study showing that a minimum wage hike to $10.10 per hour as proposed by Harkin and Miller would not only help workers, but the economy as a whole. In fact, the increase would create 85,000 new jobs.

How? By increasing consumer spending. Unlike the financially well-off who tend to hold on to their money in various forms of savings accounts, people on the low end of the economic spectrum generally spend every penny they have, simply out of necessity.

In other words, the study says, a minimum wage hike puts more money in the hands of people who will immediately pump it back into the economy, creating a healthier economic climate. With that comes new jobs.